Sale of airline tickets by commercial banks irks agents

The National Association of Nigeria Travel Agencies (NANTA) has urged the Central Bank of Nigeria ( CBN) to direct commercial banks to stop the sale of tickets to the public.

Its National President, Alhaji Aminu Agoha, who made the plea last week, said the association has concluded plans to take appropriate steps to ensure that the banking regulator prevail on the lenders to desist from selling air tickets, adding that the banks’ action, constitute an infraction on the operations of travel agencies

He said it was wrong for commercial banks to veer off their core business into the sale of airline tickets.

He said travel agencies are the only recognised bodies to sell tickets for airlines, noting that if the CBN fails to call the banks to order, it could push over 1,020 travel agencies and their 7,129 employees out of business.

Agoha said if the banks must sell airline tickets, they should set up travel agency outfits and undergo relevant industry certification before going ahead with the business .

He lamented that travel agencies are facing challenges, including zero per cent commission from foreign carriers, failure of airlines to get into the billing settlement plan, as well as failure on the part of airlines to close all ticket sales points outside the airport.

He said there is need for government to protect the interest of travel agents who contributed over $2.3 billion to the country’ Gross Domestic Product last year alone from ticket sales and tour packages.

He said: “ One of the burning issues is the sale of airline tickets by Nigerian banks. Banks in Nigeria have become “Jack of all trades” and are gradually and consistently encroaching on all businesses, including specialised areas such as ours,” wondering whether banks are licensed to act as airline agents?

He said Travel agents undergo a rigorous accreditation process before they are allowed to sell airline tickets.

“Why are airlines colluding with banks to sell tickets by offering banks commission and offering agents none? he queried.

He said banks are running series of adverts making ridiculous offers to the general public for the purchase of air tickets from such banks, warning that the trend portends a dangerous trend as banks have abandoned their core business and veered into a domain that they are not licensed to perform.

He also berated some airlines for their refusal to join the billing settlement plan, adding that their refusal has created distortion in the market.

He said: “With the implementation of the Billing Settlement Plan (BSP) in Nigeria, it was expected that all airlines would operate on the BSP as it is done worldwide. Seven years after its full implementation however, some airlines have refused to join the BSP thereby distorting the market. We wish that all airlines operating in Nigeria be compelled to conform to the system that has been fully embraced by the Nigerian market.

“Similarly, some airlines have also not joined the BSP; rather, their management has subjected travel agencies to buying tickets on a cash-and-carry basis from their offices. Furthermore, some airline’s ticketing offices are run by non indigenous companies who earn between 12 per cent and 20 per cent commission on ticket sales, yet deny travel agents their entitled commission. We wish that all airlines are compelled to conform to the BSP in the Nigerian market.”

He also berated foreign carriers for offering higher fares on Nigerian routes compared to what is obtainable in other West African countries .

Agoha said: “We do not understand the great disparity in fares between what the airlines offer to the Nigerian market and what they offer elsewhere in the world.

“The disparity in fares is alarming and we wonder why Nigeria should be singled out for this rip-off. We see no reason a flight ticket from Accra, Ghana to Europe or USA on some airlines would be cheaper than from Lagos to the same destinations on the same airline. For instance, a first class ticket to Las Vegas from Lagos is N1.8 million more than a first class ticket to the same destination from Accra. Nigerian travelers are now developing Ghanaian economy.Their travel agencies are making huge sales from the Nigerian travelers while most of our Nigerian agencies are folding up.

“From our records, travel agencies posted $1,306,304,373 revenue for the year ended December, 2014. There is an increased influx of foreign airlines into the Nigerian market. Ordinarily, this should depict great revenue potential for Nigerian travel agents.

“This is however not the case. These airlines are coming to Nigeria to rip us off. First of all, their base fares are higher than what prevails for the same flight time for journeys originating from elsewhere in the world. Even when they offer promotional fares, the added taxes charged are so huge.

“The new trend is for airlines operating in Nigeria to offer lower fares which reduces the amount of commission agents receive and to charge exorbitantly.”

He lamented the parlous state of airport facilities in Lagos, Kano and Port Harcourt, describing them as unacceptable.

He said: “NANTA is very worried about the current state of most of our airports, particularly the Murtala Muhammed Airport, Lagos; Mallam Aminu Kano International Airport, Kano and the Port Harcourt International Airport, Omagwa.”